The FTX effect has impacted the law once again – Tether’s USDT stablecoin is no longer listed on Crypto.com for its Canadian users.
Crypto.com, one of the world’s top crypto exchanges by trade volume, is to delist USDT, Tether’s dollar-pegged stablecoin for its trading platform users in Canada.
In an email sent by the firm to its customers, a Crypto.com representative wrote that the decision was made “in accordance with instructions from the Ontario Securities Commission (OSC) as part of our pre-registration undertaking for a restricted dealer licence.”
By 1 p.m. EST on January 31, the trading platform will suspend all USDT trading pairs, transactions, deposits, and withdrawals, the email continues. If there are any remaining USDT user deposits on the exchange, Crypto.com users in Canada will have their USDT converted to Circle-issued USDC.
The fall of FTX has created massive – and quite sudden – changes within the crypto sector. In the aftermath as regulators across the globe are increasingly keeping watch on crypto, FTX’s ripples, and stablecoins.
Canada’s top securities regulator, the Canadian Securities Administrators (CSA), announced via press release that it would strengthen its monitoring of crypto exchanges. Amongst its plans includes “expanding existing requirements”, while it “continues to monitor and assess the presence and role of stablecoins in Canadian capital markets.”
Crypto.com users in Canada may be under pressure, as USDT is an integral part of trading in the crypto market. With a market capitalization of $66 billion, USDT is known to be the most popular stablecoin – competing with USDC ($44 billion market cap), and the Paxos-issued Binance USD ($16 billion market cap).
However, USDT has been gathering bad rep recently as controversies surrounding its issuer Tether and how its values are backed are running more rampant.
According to crypto analyst John Paul Koning, Canadian digital-asset trading platforms have been historically reluctant to list USDT. In reports filed to the CSA in 2021, Coinberry and Wealthsimple – both Canadian crypto companies – have prohibited the use of USDT on their platforms.
As of writing, there seems to be a stablecoin war between BUSD, USDT, and USDC on centralised exchanges. According to data from DefiLlama, USDT’s total market value is $66.26 billion, USDC at $43.31 billion, and BUSD at $16.43 billion. Throughout 2022, USDT’s value fell by 15%, USDC gained 4%, and BUSD gained 20%, CoinGecko data notes.